The Kenyan government has scrapped several taxes proposed in this year’s controversial finance bill, including a 16% tax on bread, after a public outcry.
The lawmakers’ announcement came as police fired tear gas and used water cannon to try to disperse angry protesters in the capital Nairobi.
Dozens of people were arrested, and lawyers had earlier joined a chanting crowd at the city’s main police station to demand the release of those detained.
Since taking office in 2022, President William Ruto has introduced several new and unpopular taxes with the aim of eliminating the country’s nearly $80 billion national debt.
But critics of the latest proposals fear they will stifle economic growth and lead to job losses.
Some protesters marched through the capital calling for the president to resign, shouting: “Ruto must go! Ruto must go!”
The reversal of the new finance bill was announced by Kuria Kimani, chairperson of the parliamentary finance committee, at a press conference attended by President Ruto as well as other lawmakers in the ruling coalition.
His finance team is gathering public views on the bill and he said the decision to scrap some proposals was made to protect Kenyans from the rising cost of living.
Other proposed taxes that have been cut include taxes on cooking oil, mobile money services and on motor vehicles, which critics say would also affect the insurance industry.
Mr Kimani also announced the abolition of a proposed eco-tax targeting products considered to have a negative impact on the environment, such as packaging, plastics and tyres.
It has faced a backlash with many saying it will increase the cost of vital items such as nappies, sanitary towels, computers and mobile phones.
Mr. Kimani said that this tax currently only applies to imported goods.
Mr Ruto did not speak or react during the meeting – but this move, considered to be unable to withstand public pressure, will be a major blow to his government.
He recently urged Kenyans to accept more taxation, arguing that they were in fact undertaxed, but he admitted that would be difficult.
Over the past two years, taxes on wages, fuel and gross receipts have increased.
A housing tax equal to 1.5% of a worker’s monthly salary, intended for the construction of low-cost homes, has also been introduced.
A new, higher health insurance tax rate will also take effect soon.
Lawmakers are expected to discuss the finance bill on Wednesday, which is why protests are being held in the capital.
Police arrested several people accused of organizing the protests.
Human rights groups have condemned the police response.
“I am very angry and I am fighting for my future,” a protester named Wangari told AFP news agency on Tuesday.
“I’m still a young man and I want to develop myself in this country. And with such taxes, with such exploitation, I don’t understand how we can build a life .”
